ITS Maintenance Experience in Michigan Gregory D. Krueger, P.E. Metro Region Traffic and Safety Engineer Michigan Department of Transportation

Background Michigan ITS originally deployed in the 1970’sMichigan ITS originally deployed in the 1970’s Significant expansion in Significant expansion in Continued modernization over timeContinued modernization over time

Current Operations Freeway Operations CenterFreeway Operations Center 180 cameras180 cameras 65 DMS65 DMS detectors2000+ detectors Mixed-media communicationsMixed-media communications Links to partnersLinks to partners No major upgrades in past 10 yearsNo major upgrades in past 10 years

Why Contract? MDOT’s overall program increased approximately 100% in the past 13 years ($1.6B to $3.1B)MDOT’s overall program increased approximately 100% in the past 13 years ($1.6B to $3.1B) MDOT’s staffing levels have fallen 27% in the past 13 years (3,868 to 2,826)MDOT’s staffing levels have fallen 27% in the past 13 years (3,868 to 2,826) MDOT is currently limited in the ability to hire new staffMDOT is currently limited in the ability to hire new staff MDOT currently has 2 staff members doing maintenance of ITS facilitiesMDOT currently has 2 staff members doing maintenance of ITS facilities

Contract History Original system was maintained by in-house staffOriginal system was maintained by in-house staff Expansion maintenance was part of original construction contractExpansion maintenance was part of original construction contract RFP in 2000 for maintenance of hardware and softwareRFP in 2000 for maintenance of hardware and software Contract expired on March 26, 2004Contract expired on March 26, 2004 Currently using an interim maintenance providerCurrently using an interim maintenance provider Developing a new RFP for a long-term maintenance contract (3-5 years)Developing a new RFP for a long-term maintenance contract (3-5 years)

Contract Mechanisms Purchase Orders (small activities)Purchase Orders (small activities) Statewide, task order based general contractsStatewide, task order based general contracts Construction-type contracts (pay items)Construction-type contracts (pay items) Service-type contracts (time and materials)Service-type contracts (time and materials)

Payment Options Pay for level of effort/number of staff (assume X full-time people and pay 100% of their time)Pay for level of effort/number of staff (assume X full-time people and pay 100% of their time) Pay for equipment-days of service (the CCTV must be operational 350 days per year – OR – pay $X per day the CCTV is operational)Pay for equipment-days of service (the CCTV must be operational 350 days per year – OR – pay $X per day the CCTV is operational) Pay for work orderPay for work order

Pay for Level of Effort No incentive to use staff efficientlyNo incentive to use staff efficiently Easy to administerEasy to administer

Pay for Equipment Days of Service Simple to defineSimple to define Incentive for effective use of staff hoursIncentive for effective use of staff hours Moderate complexity to administerModerate complexity to administer

Pay for Work Order Moderate complexity to define (due to overlapping pay items)Moderate complexity to define (due to overlapping pay items) Low to moderate incentive for effective use of staffLow to moderate incentive for effective use of staff Difficult and time consuming to administerDifficult and time consuming to administer

Performance Requirements OptionsOptions –System availability –Response Time –Penalties Issues –Potential for increased bid prices with penalties –Administration effort increases need for inspection, monitoring –Partnership between MDOT and maintenance provider

Performance Requirements Recommendations in MDOT ScopeRecommendations in MDOT Scope –Defined performance requirements –Permit penalties at discretion of engineer –Grace period for system availability –Penalty notification/warning period –Reasonable penalties

Equipment Purchase Include in contractor pay itemsInclude in contractor pay items –Higher risk –How does contractor estimate? Estimated quantity by DOT with contractor bidsEstimated quantity by DOT with contractor bids –Complex to define –Non-specified parts? –Establishes prices for entire contract –Low incentive for doing cost-effective repairs

Equipment Purchase (cont.) MDOT owns inventoryMDOT owns inventory –Difficult to administer –Potential for delay in repairs to unavailable hardware Lump sum equipment “bank”Lump sum equipment “bank” –Industry standard –Allows for material markup (in Michigan) –Takes time to administer

Third Party Damage Separate category in contract since it is impossible to plan forSeparate category in contract since it is impossible to plan for OptionsOptions –Exclude from scope and use other purchasing methods to do work Delay in repairs (have to issue a new work order)Delay in repairs (have to issue a new work order) How do you differentiate claims of damage by others from normal damage or contractor negligence?How do you differentiate claims of damage by others from normal damage or contractor negligence?

Third Party Damage (cont.) Include budget and provision for “as- authorized” work with estimateInclude budget and provision for “as- authorized” work with estimate –Requires an estimate for each third party damage –What if damage is more extensive than originally thought? If authorized with budgetary estimateIf authorized with budgetary estimate –Quick to authorize –Moderately complex to administer –Requires trust between DOT and contractor

Conclusions Need to answer each question to determine contract typeNeed to answer each question to determine contract type DOT resources are valuable – need to determine where those resources are most appropriately usedDOT resources are valuable – need to determine where those resources are most appropriately used Need a method to measure performance of maintenance activitiesNeed a method to measure performance of maintenance activities Use shorter term contracts with pre-approved extensions to avoid being locked inUse shorter term contracts with pre-approved extensions to avoid being locked in Take the time to develop a contract that you are comfortable withTake the time to develop a contract that you are comfortable with